Public opinion: Your blogs

Should LEPs unite around themes?

Rarely a day goes by without news of a new local enterprise partnership (LEP) being announced. To date most of the focus has been on how the regions are going to be divvied up with particular interest in the future of the northeast and the southwest English regions.

But what happens if the place where you live has little in common with the wider area? Perhaps your local economy is more similar to a place hundreds of miles away than to the next urban area. These geographical anomalies have led to suggestions that in some circumstances it might be more appropriate to base LEPs on themes rather than geography.

According to the website Insider, Somerset council has talked to local authorities in Cumbria and Suffolk about the possibility of creating a "thematic" LEP focused on the two areas’ shared reliance on the nuclear industry.

Local authorities and businesses have already been encouraged to think beyond traditional county boundaries by central government. And Somerset Council says there are no barriers to the idea of ‘thematic’ LEPs focusing on strategic issues.

Meanwhile, the Development Trusts Association’s Jess Steele has floated the idea of a Seaside Enterprise Partnership. She has already told the communities and local government select committee that seaside strategy should not be left to a regional development agency. Her argument is that a place like Hastings has very different economies from a town like Lewes and as LEPs form, she recommends an approach focused on seaside towns in need of financial help.

However, locational issues may prove to be a stumbling block for the nuclear themed LEP. Insider's article reports that Cumbria thinks Somerset is too far away to form a LEP with and would not back a grouping mainly based on the nuclear industry.

So perhaps these thematic LEPs will need some geographical grounding – for example basing a Seaside Enterprise Partnership on a particular stretch of coastline. The idea of thematic LEPs certainly has potential. The question is how far do you go before a theme is stretched too far?

Merge Bura with IED to create something better

I remember watching a Western series when I was a boy called “Branded” which started with an officer being ceremonially stripped of his badges of rank, and thrown out of the US Army. The image came to mind as I started writing because I may well get cashiered out of the IED for suggesting this, and formally stripped of my Fellowship.

With news that Bura is in liquidation and that “senior industry figures” are sketching plans for a replacement which might be able to balance its books, I want to suggest that the Institute of Economic Development joins those talks with a view to merger.

IED is the older body, originally formed as the Institution of Economic Development Officers nearly a decade before Bura was conceived. It does good work, with an excellent conference and a suite of formal qualifications running from Certificate through Diploma to Masters. But it is far too small, hovering under 1,000 members all the time I’ve been involved, with minimal profile and less influence. All good stuff, but it’s not got close to its ambition to become the professional body for the economic development profession, and shows no signs of getting closer.

Bura, by contrast, is the brash kid on the block, (sorry, Jackie, nothing personal!), the one with the new bike and the smartest friends. From its earliest days it had bigger ideas and made the effort to get them done, and it has also done good work, most obviously by identifying and publicising good practice. Bura, too, has run useful courses, but it has come no closer to becoming the must-join professional body than IED has. Indeed, with an eye on the bank balance I presume, it has become too much associated with the capital projects side of the business: important, of course, but far from the whole picture.

It’s not straightforward, of course, because many economic development professionals are already members of the RTPI or Rics, with subs to pay and CPD points to accumulate. So it’s not as simple as saying “look across the Atlantic to IEDC, the US-based International Economic Development Council: there’s a model of influence, and serious professional development, which we would do well to emulate”.

It’s not that simple, but do let’s take this opportunity to think big, to draw together the professional development strand which IED has done well, the best practice promotion which Bura has done well, and the effective representation which both have sought, with too little success. There’s a bigger prize to be won.

Life after Bura

It was supposed to be a momentous year and it certainly has turned out that way – but for all the wrong reasons. Having just a few months ago celebrated its 20th anniversary, the British Urban Regeneration Association (Bura) is to go into voluntary liquidation.

Rather than ponder what went wrong, perhaps it would be more constructive to consider where we go next. Indeed, in her letter to members announcing the move, chair Jackie Sadek revealed ‘leading industry figures’ were already working on developing a replacement for Bura.

So let’s open it up to those working in regeneration – what would you like to see fill the void left by Bura?

Do we need a body to represent the ‘regeneration sector’ – it is, after all, a collection of different sectors covering many professions.

What functions should be saved? Do organisations and individuals really need a membership body to provide networking opportunities? Who is best placed to deliver training?

From a personal point of view, Bura’s greatest legacy (and one which must be protected) is the rigorous and respected awards schemes run successfully for many years. They have helped highlight and spread best practice and now, more than ever, we need vehicles to perform that role.

Where will the Big Society live?

The Big Society project seeks to 'give increased power to people to solve problems closer to where they live'. Under the current economic climate, meeting housing needs is increasingly difficult for people and governments. The need for affordable housing is stark: if the price of chicken had increased as fast as house prices since 1971, we’d be paying close to £50 for a roast dinner.

The coalition says it wants more affordable homes. They have introduced a series of reforms to localise decisions around new housebuilding, but there are fundamental challenges in this approach. Home-owners make up 70% of adults in the UK: investors in homes as assets that appreciate greatly in conditions where demand is growing faster than supply.

This represents a strong disincentive for these individuals to support additional housebuilding. The housing market in its current form cannot both deliver wealth accumulation for existing home owners, and affordable opportunities for all members of society to meet their need for accommodation. Policy changes announced so far will not solve deep-rooted problems in the way British society houses itself: they are more likely to worsen the housing crisis than address it.

For starters: the housing minister no longer has a seat in the cabinet, the cuts have been drastic at the Homes and Communities Agency, and reforms to the manifold problems of the social housing sector focus on making tenure more mobile and conditional, but without a Big Society solution to the displacement created by the controversial cut to housing benefits.

Under the localism banner, Regional Spatial Strategies (RSS), which set house building targets for local authorities in England, have been scrapped. RSSs, albeit cumbersome, unpopular, and drafted by unelected Regional Assemblies, had an ambition to plan for something in the range of 240,000 to 290,000 homes per year for the next 20 years: thought to be sufficient to stabilise affordability at 2007 levels and meet future need and demand. In the last year, 113,000 homes were built in England.

Given our nation's impressive protection of the countryside, getting close to RSS target annual completions involved squeezing out new flats and houses from small slithers of land where policy allowed. Many home owners and bowls clubs cashed in on the housing boom by selling off gardens and pitches. Often unpopular to their neighbours, such developments benefited from qualifying against local authority targets that housing development should take place on previously-developed brownfield land. It was, however, hard for local authorities to negotiate any contributions from developers to meet growing infrastructure needs: this model of development was aptly described as 'town cramming' rather than 'town planning'.

The coalition has decided gardens are now to be reclassified as greenfield in the planning system. The popularity of this policy change is not surprising, but this is localism which will serve to choke off potential new housing supply. Vaguely defined Big Society initiatives such as the Right to Build will not compensate - indeed they may serve only to refocus the controversy around new housing development.

Developing new homes is a classic problem of collective action: the imposition is felt by those who neighbour development sites, new residents are seen as a burden to local schools, doctors and parks. Labour's Community Infrastructure Levy is set to standardise the contributions made by developers to local services, rather than the agreements currently negotiated under Section 106 of the Planning Act.

Planners and developers are anxious for the new government to complete the picture of reforms to the system: very little happens in a policy vacuum. Local authorities have scrapped plans for 85,000 homes since the election and 29 national bodies have written to Eric Pickles arguing that planning reform needs something more than nods to localism.

Any attempts to seriously engage with the need for new homes faces a number of challenges – not least to make those homes zero carbon by 2016, a pledge introduced by Labour but without a definition of 'zero carbon'. House prices in Britain are peculiarly volatile, while housebuilders are peculiarly unresponsive to demand, partly due to the rigid planning system.

Support for a housebuilding surge from housebuilders may in reality be limited: it was always naïve for the Labour government to lead developers towards raising supply to the point of bringing down house prices. In a business model which is essentially about short-term “flipping” of land, with a profit on the process of building a home, housebuilders would be losing money on land they had already bought. As Mark Twain quipped in the late 19th Century: “Buy land, they're not making it any more”. The house price bubble was really a land price bubble.

There are quick wins: encouraging self-builders and removing barriers which prevent empty homes being occupied. However, the greatest challenge is fundamental: the public is being encouraged to acquire and speculate on an asset, and also – increasingly, under the localism agenda – responsible for regulating the supply of new homes to be created.

The answers are not simple: in Ireland and Spain, huge booms in house building did not prevent drastic price bubbles and their housing markets remain debilitated today. House prices are also driven by the availability of credit and expectations of future price growth, which is why we hear estate agents blame the media for the recent fall in house prices.

The good news? There's probably never been a better time to try to address fundamental challenges: to build for a bigger society we clearly need a new economy of housing.

This blog is co-published on the new economics foundation blog http://neweconomics.org/blog/2010/08/20/where-will-the-big-society-live

LEPs can’t be a peg for every fleeting whim

Last month, New Start and Shared Intelligence held a roundtable seminar on Local Enterprise Partnerships, the latest in New Start’s series of RegenFuture events and discussions.

The event brought together local practitioners, analysts and national stakeholders including the Institute of Directors, Work Foundation and Core Cities to identify the key factors and drivers that will make the transition from RDAs to LEPs a success.

Following the event, we responded to the House of Commons’ Business, Innovation and Skills Committee call for evidence to inform their inquiry into LEPs. Our submission set out the core questions which we suggest the Inquiry should follow based on the roundtable discussion.

Julian Dobson blogged some immediate thoughts after the event. This post summarises the key messages in our evidence to the Inquiry.

The big picture emerges – and LEPs are at the centre

The bare bones of the government’s approach to economic development and regeneration are becoming gradually clear.

In his Bloomberg speech this week, the chancellor underlined the shift in investment to 're-focus public spending in those areas that will make a difference to our long-term economic success'.

Instead of programmes which, to their critics, rewarded failure and encouraged dependency, the government will be much more hard-headed about rewarding success and encouraging growth areas to go further and faster.

A few days earlier Eric Pickles reiterated his determination to either abolish or devolve to the local level a whole series of plan-making and delivery powers. In the same interview, he also confessed to having 'great fun abolishing lots of stuff'.

Pickles has encouraged LEPs to be bold in their submissions about the powers they want, and there’s talk that some parts of CLG are lobbying for directly elected mayors to head up LEPs.

With so many other parts of the system being dismantled and the government further strengthening its focus on private-sector led growth and enterprise as the means for delivering wider social goals, the role of LEPs is becoming increasingly important.

Our evidence - making LEPs work

The lobbying to make elected mayors the chair of LEPs neatly highlights our first point to the BIC Committee: LEPs can’t be a peg for every fleeting ministerial whim.

LEPs need to prioritise their functions and investments to ensure there is a clarity of purpose across their activities. These activities need to be guided by the needs of local businesses and enterprises, including social enterprise, and be delivered through flexible partnerships.

Central government must be equally rigorous and consistent about freedoms and flexibilities, and encourage local innovation.

The inevitable discussions about structures and roles within LEPs, as the new arrangements settle in, should not distract from fundamental challenge – whether LEPs can attract additional funding and direct it in ways that add value to local activity.

Finally, we argued that there should be a role for tackling deprivation and driving regeneration where that was a local priority. Promoting enterprise growth isn’t just for better off areas.

Keeping up the debate

Join the debate about LEPs and the future of regeneration here: http://www.regenfuture.org/